On Monday, Asia-focused HSBC Holdings Plc (HSBA.L) was informed by Citigroup Inc (C.N) that it has reached an agreement to purchase Citigroup’s China consumer wealth portfolio, which includes clients, assets under management (AUM), and deposits.

The transaction, which covers approximately $3.6 billion in deposits and investment AUMs, is anticipated to be completed in the first half of 2024. The transaction’s financial specifics were kept confidential.

The U.S.-based bank stated in a statement that “today’s announcement advances the wind-down of Citi’s consumer banking business in China, which was announced in December 2022.”

As part of an overhaul of its global strategy, Citi group first disclosed its intention to leave China’s consumer banking in April 2021. With options for deposits, funds, and structured products, the consumer banking sector mostly catered to wealthy customers.

The acquisition of Citi’s consumer wealth division in China by HSBC, first announced by Reuters late last month, will significantly expand the London-based bank’s operations in the second-largest economy in the world.

Chinese banks and foreign competitors, such as Standard Chartered, who all have more retail branches handling wealth management, dwarf Citi’s consumer banking operations in China.

As the largest lender in Europe pledges to withdraw from less lucrative regions in order to concentrate on Asia, its main source of revenue, the acquisition of Citi’s wealth portfolio will assist HSBC in growing its position in China, one of its important markets.

According to a statement released by the bank on Monday, HSBC can now offer wealth management solutions, mobile fund and insurance solutions, and insurance solutions in mainland China based on the regulatory licences it has received recently.

In January, it was revealed that HSBC had made a strategic investment in Shanghai MediTrust Health Technology Co. Ltd.

According to a statement from HSBC, almost 35% of the $27 billion in net new invested asset inflows in Asia for the first half of 2023 came from locations outside of Hong Kong, an increase of 21% year over year.

According to the bank, the agreement with HSBC excludes Citi’s institutional businesses. It also stated that it would continue to meet the needs of wealthy to extremely wealthy Chinese clients through its regional wealth hubs in Singapore and Hong Kong.

Citi reported that it has already finalised sales in eight markets since declaring its intention to depart consumer banking across 14 markets in Asia, Europe, the Middle East, and Mexico as part of its strategic reorganisation.

In addition to the consumer banking agreement with China, the bank statement stated that Citi planned to sell its Indonesian consumer business by the end of the year.

Both Citi’s consumer business in Korea and its overall operation in Russia are currently being wound down, as previously disclosed. Additionally, Citi has disclosed that it intends to pursue an IPO for its Mexican consumer, small business, and middle market banking operations.